£1million a day

The public sector is spending up to a million pounds a day on freelance managers, as it struggles to keep up with tough government targets.

Hundreds of interim managers are being parachuted in to fill skills gaps and deliver massive change programmes.

Research by the Praxis interim management agency shows that the public sector used twice as many interim managers as any other, with 35% of those on interim projects working in the sector.

Interim managers can command up to £2,000 a day, but Sara Stilliard, marketing director at Praxis, said the average salaries in the public sector ranges from £500 to £750. With about 1,400 interim managers presently working in the public sector, the bill for the taxpayer could run up to £1,050,000 a day.

The Home Office said it was unable to comment on the numbers because of the upcoming election.

But Nick Robeson, chairman of the Interim Managers Association said some interim agencies were reporting 30% to 40% more public sector business in the last year.

He said the pressure from Chancellor Gordon Brown to deliver on targets set by the government, as well as from the Office of Government Commerce, meant significant change agendas had to be delivered quickly.

“They don’t have the skillsets in the public sector to deliver these change management programmes,” he said. “Many of them have always just walked the same corridors, never challenging what they do by using outside skills and techniques.”

Jan Parkinson, president of the Society of Personnel Officers in Local Government (Socpo), said there were issues around the amount the public sector was being asked to do, which was resulting in skills shortages.

However, she said using interim managers was not cost effective in the longer term, and advised councils that were struggling to consider linking up with others to bridge capacity gaps.

The survey found the length of time interim managers are staying in their posts is growing, with the average length of assignment standing at eight months in 2004, compared to six months in 2003, with one in 10 on HR-related projects.